Which of the following statements is (are) correct?
A) Overtime premiums should be treated as a component of manufacturing overhead.
B) Overtime premiums should be treated as a component of direct labor.
C) Idle time should be treated as a component of direct labor.
D) Idle time should be accounted for as a special type of loss.
E) Overtime premiums should be treated as a component of direct labor and idle time should be treated as a component of direct labor.

Question

Quizplus · Accepted Answer

Overtime premiums are typically considered part of manufacturing overhead because they are not directly attributable to a specific job or product. Idle time is also generally treated as overhead or a type of loss, not as direct labor.

Which of the Following Statements Is (Are) Correct